Mark Boulting, CEO of the Plymouth-based Skills Group, has hit out at the apprenticeship levy, claiming that it could end up ‘rebadging and renaming current skills.’
Apprenticeship providers becoming ‘target driven’
With apprenticeships on top of the agenda, the Conservative government is looking to create three million apprenticeships by 2020. Businesses with a wage bill of over £3m will be forced to pay a 0.5% levy by 2017.
In an interview with the Western Morning News, Boulting said he would have preferred that the government set a target of two million apprenticeships instead of three, fearing that the government could become too ‘target driven.’
Boulting said: ‘‘we would have preferred if the Government had taken their time to think it through and not rushed into it.
We don’t want to see a mere rebadging and renaming of current skills. The last thing apprenticeship providers want is to become target driven. We want to provide quality apprenticeship and good employment opportunities for young people,’’ continued the CEO.
Potential impact on SMEs
The levy could affect some businesses operating in Devon and Cornwall; however 85% of firms are classed as SMEs, so they are unlikely to be hit with the tax.
Boulting has reservations about the levy, fearing that ‘‘small firms might feel the pinch if larger companies start putting their prices up and pass the cost down the food chain onto their suppliers.
“We fear it may add yet another layer of bureaucracy. How will that help young people?
The bureaucracy of the new scheme and its implementation has yet to be fleshed out but it will increase administrative costs by at least 10% for skills providers like us or colleges.
While we used to deal with one customer – the Government – now we’ll have to deal with 900. It will have a huge impact in term of cash flow and admin costs,” concluded Boulting, who has previously spoken out against apprenticeship wages, claiming that the wage will still have to be raised in order to make apprenticeships “more attractive to young people.”